Principle 7: The GB should comprise the appropriate balance of knowledge, skills, experience, diversity and independence
Independence and conflicts
Lead independent director is appointed:
Chairman
Disclosure with regards to the composition of the GB:
Satisfaction with regards to the appropriate mix of knowledge, skills, experience, diversity and independence on the GB.
The targets set for gender and race representation in the membership of the GB, and progress made against these targets.
The categorisation of each member as executive or non-executive.
The categorisation of each non-executive member as independent or not and, when a non-executive member of the GB has been serving for longer than nine years, a summary of the views of the GB on the independence of the member.
The qualifications and experience of members.
Each member’s period of service on the GB.
The age of each member.
Other GB and professional positions held by each member.
The reasons why any members of the GB have been removed, resigned or retired.
The chair should not be a member of the audit committee.
Determine the number of outside professional positions that the chair is allowed to hold, taking into account the relative size and complexity of the organisations involved.
The chair may be a member of the committee responsible for remuneration but should not be its chair.
The chair should be a member of the committee responsible for nominations of members of the GB and may also be its chair.
A retired CEO should not become the chair until three complete years have passed after the end of the CEO’s tenure.
The chair may be a member of the committee responsible for risk governance and may also be its chair.
The CEO of the organisation may not be the chair.
The chair may be a member of the social and ethics committee but should not be its chair.
The role, responsibilities and term in office should be documented in the charter.
Should be succession planning in place for the position of chair.
The GB should elect an independent non-executive member as chair.
Disclose the chair’s independence and also whether a lead independent director was appointed
To serve as a sounding board for the chair.
To lead in the absence of the chair.
To act as an intermediary between the chair and other members of the GB, if necessary.
To deal with shareholders’ concerns where contact through the normal channels has failed to resolve concerns, or where such contact is inappropriate.
To strengthen independence on the GB if the chair is not an independent non-executive member of the GB.
To chair discussions and decision-making by the GB on matters where the chair has a conflict of interest.
To lead the performance appraisal of the chair.